What to do about being moved to a new broker due to acquisition?

Hi Guys, I am sorry if i open the topic on a wrong place. I have some problems and do not feel comfortable so i just wanted to get your thoughts and advises on what the to do in current situation..

I deal with forex from 2009, and was active between 2009-2011 then left for couple of years and restarted again on 2013-now.... Not going bad and making investments as a long term trader i work with Fx solutions. First my account was in US and after regulations changed in US as leverages decreased they moved the account to UK. Last year i received a mail from them as Gain Capital has owned City İndex group which also owns Fx Solutions UK and it will not effect antyhing. I am very satisfied with their GTS pro platform also. Sometime later the fxsloution website is directed to cityindex and on saturday i received a mail about the account will be moved to city index with my all trades remain the same without loss or gain or should be closed till 14 th of may if not would like to continue to city index. I checked their platforms and they use AT PRO, you cannot change the leverage as a fixed 200:1 which i always use 50:1, they have more commodities currency many more products, but they use FIFO if you do not select hedge trading. Also there is no HEDGE option for a trade which is going wrong. These are the key factors for me. So I refuse to use ther crappy platform and refuse to close my losing positions. And I have to protect my self and my account from their forced attitude... So what do you suggest, move on to another broker with losses? discuss this situatioın with a good financial lawyer, (will really appreciate if you can advise me real good one in UK) OR do not close the trades and see what will they do on 14th may and act,sue them according to that? My account has almost 40K USD so it worth dealing with it...

Hi, kanji

When companies take others over, I dont think you can do much. Seems like you have to exit the trades at some point and move onto another broker. You may be able to negotiate with them to keep your trades open for longer etc .Without being aware of how your current trades are structured, I cannot advise.

MT

One way I heard of dealing with this lack of hedging is to have multiple accounts at same broker and then see that you can transfer money between the accounts for no cost.

Hi MT, thank you for your reply, as far as i can get some information about their platform things are a bit different, you can adjust leverage from another platform and it stays the same in other platforms too, so this one seems to be solved now. My other problem was hedgeing which seems possible as i tried it in theirr demo account now, and when i counter open a position, it doesnt take extra margin to open a position and that seems to be solved now. Also checking the Fifo trades now as it should be off. I plan to keep the original account in Fxsol and will not transfer to the last day as i am fully convinced that i can deal with the new platform.

That should be possible but then it means whenyou open a new position you also spare a margin for that position, but when in same account you do not have to spare a margin for a hedge position

Hi Guys,

I would like you to give an update with the current situation of Fx solutions UK account which to a new migrated City İndex Account. With i had 26 trades open, my account was moved to City Index on 14th of May 2016. Before the migration i was paying aorund 7,83$ as financing charges. After transfering my account, on first day i had ben charged as 36,20$ daily. I made many calls with UK office and they said they are investigating the case. Next day it was 28$. Since i am using 50:1 leverage, the cost of financing should be optimal but somehow the cost increased as much as 4 to 5 times since the interest rates are the same. So somehow while chatting wtih client representative, we realized that, altough the account was opened 50:1 and my positions were opened with 50:1 leverage, the premiums paid and the financing charge applied has been reflected as am using a 200:1 leverage. Since they have two accounts as a CFD account and MT4 account, they had opened my account on CFD with 200:1 charges applied. So as they couldn't decrease the leverage in CFD account, they just opened a new MT4 account, refunded the 2 days financing charge. Everything seems normal, but that day on Wednesday, 3 day roll charge, my account was charged at 54,54$ which is more than twice of my previous FX Solutions account. The week before i had paid 23,xx$ for 3 day rollover. So i contacted again and ask why is that so, they said everything normal but opened a case for investigation. As far as i checked from premiums and charging daily in my FX Solutions Account, i was paid 2,11$ daily for a standard lot daily, and was being charged -2,90$ on short side, now the cost has been arranged as 1,30$ payable for the long side, and -3$ charged for the short side. Now this calculation may seem not much but as i hold some trades more than a year, as a fast calculation and a comparison with my previous account on Fx solutions i have to pay 2850$ yearly vs 6700$ yearly in City Index now!!

My question is; since i opened these trades by calculating the costs of the time opened, do they have a right to force me obey their premium and commision rates as they like? Don't do I have a right to ask for refund my initial balance without losses because that i am not accepting their unlogical policy.

I respect every companies spread rates , leverages and commission rates. There is no problem on that. If you like you work with the firm, if you dont you just quit, thats o.k. for me. But closing a company and moving the accounts to a more costly second company and pushing the clients to pay the rules is not a fair and acceptable manner for me.

I talked with their manager and he said, he can log this as a complaint to their headquarters and this may take some weeks as up to 8 weeks to reply.(within the legal time)

By the way of course i did not sit keep my hands tied, i called FCA and gave a complaint log about the sitiuation, describing these clearly and they noted down, also asked me to send an email to their complience email address about this situation. Also they reminded me that they have a right to reply to be in 8 weeks after complience. Then i called Financial Ombudsman and they also said the same as since I have to send them a mail about the matter clearly describing with the proofs and wait for an answer. If not satisfied then Ombudsman contact them if i didnot get wrong.

I am asking for your suggestions, should I contact a lawyer at the moment to file a lawsuit regarding unfair trading conditions causing me financially vulnarable by increasing charges more than tiwce and asking a full refund to my initial transfer of my funds without my open trades whether they are in loss?

Appreciate for your suggestions...

This is my take on this: At first when they migrated your accounts to City Index, they should've kept your leverage at 50:1 for MT4 accounts. They have wrongly moved you to a CFD account with 200:1 leverage and thus overcharged you interest. That was wrong and they have refunded you the overcharged interest, that was correct. But after that, since now you have an MT4 account with 50:1 leverage with City Index, City Index is entitled to apply whatever policy, features or requirements including financing charges applicable for MT4 accounts with 50:1 leverage. They have no obligation to respect whatever the arrangement that you had with FX Solution. To them FX Solution accounts no longer exists, you are City Index now. However, they also DO NOT have the right to apply their policies or features or arrangement including financing charges retroactively to your existing open trades right from the beginning since the time that you opened those trades because when you opened those trades, you were still with FX Solution and NOT with them; they only have the right to apply whatever policy to those trades after the takeover or migration date.

What you should've done is close those trades as soon as they have refunded you the overcharged interest as soon as I realize what City Index has to offer is NOT what I am looking for. This is what I would've done especially that they gave you a date to close the trades if you don't want to stay with City Index. Because after the migration is complete, if you still have Takeover of brokerage firms and migration of accounts IS tricky. Unless it's really a bilateral move between two firms with completely identical policies and offerings and etc., sometimes you do have to act fast to do the research and make fast decision to take care of your trades if you don't like the new firm.

This is my personal take on this and I would suggest you to consult a financial lawyer who specializes AND has experience in Securities law in the financial industry. I am NOT a legal expert so don't take my word for it.

Good luck!

Hi Forexia, thank you for sharing your toughts.

As i mentioned before, i do not think that City Index trying to rip off their clients with financial charges or else, and since Fx Solutions were under their control, i even didn'thave any issues with them, no slippage no overcharge nothing... In Fx solutions they were allowing 1:400 leverage however now it's been reduced to 1:200. Since i use 1:50 it even do not effect me. The speads are much more lower than FxSol but also that's not much important for me as I don't scalp and take a position and wait for it. As far as i figured out, the cost of financing has been increased so they try to adopt the accounts according to this, also decreasing the leverage is one of them. From my side, as i said I respect every brokers' policy and trading rules, since they should have provided the same fair conditions to trade, at least i close my previous trades due to a migration. Of course when I open new trades, it means i accept their rules and terms, so nothing to complain about that.

Coming to your suggestion about closing the trades, as my current open trades are in red, i do not want to make such a move. But under my complaint mail, i asked for adjusting the financial charges similar to FxSol's till my trades are closed, or, transfering my whole cash balance, which is before loss as they closed my positions breakeven on Fx Sol, and then opened again with loss in City Index normally. As I think they will not accept that, and if their complience team do not decide objectively, we will see if the justice in UK's financial area really rules or not. The FCA guys, who were very helpfull, told me that, even tough every company has its rules and policies, we set the rules not them. So that made me comfortable because i am not behind cheating asking for a favor or else. Only I ask is fair trading, that'it
And i will definetly consult to a lawyer as i am searching for a trustable one at the moment